Organizational Form and Trade Liberalization: Plant-Level Evidence

2021 ◽  
Author(s):  
John (Jianqiu) Bai
Keyword(s):  
Trade Liberalization ◽  
Core Competency ◽  
Extensive Margin ◽  
Trade Policies ◽  
Trade Shocks ◽  
Internal Organization ◽  
Level Data ◽  
Plant Level ◽  
The Impact ◽  
Aggregate Industry

This paper studies how firms’ internal organization shapes the impact of international trade. Using establishment-level data from the U.S. Census and a difference-in-difference specification, I find that, relative to standalone firms, conglomerates are more likely to restructure after trade liberalization episodes, focusing on their core competency and improving firm productivity and product market performance. Adjustments through the extensive margin account for the majority of the productivity growth differential between conglomerates and standalones experiencing trade shocks. Aggregate industry productivity remains relatively unchanged in industries dominated by conglomerates’ core business but decreases significantly in others. My findings suggest that firms’ internal organization has important consequences on the effects of trade policies. This paper was accepted by Gustavo Manso, finance.

scholarly journals Import Liberalization of Intermediates and Environment: Empirical Evidence from Chinese Manufacturing

2019 ◽  
Vol 11 (9) ◽  
pp. 2579 ◽  
Author(s):  
Ling-Yun He ◽  
Liang Wang
Keyword(s):  
Manufacturing Sector ◽  
Firm Level ◽  
Intermediate Inputs ◽  
Interaction Terms ◽  
Level Data ◽  
Plant Level ◽  
Pollution Emissions ◽  
The Impact ◽  
Scale Composition ◽  
Level Lowering

This paper investigates how the import liberalization of intermediates affects firm-level pollution emissions. We divide the impact of freer import of intermediates on pollution emissions into induced scale, composition and technique effects and then develop interaction terms to examine these effects. Relying on a panel of plant-level data from China manufacturing sector for the period 2001 to 2007, we find freer import of intermediate inputs is conducive to pollution reductions at the plant level, lowering pollution via induced technique and composition effects and, in turn, increasing emission through induced scale effect. In summary, import liberalization of intermediate inputs can contribute to the better environmental performance of China manufacturing sector.

scholarly journals Trade liberalization and firm-level productivity: A panel data analysis of the Indian iron-steel industry

2018 ◽  
Vol 63 (219) ◽  
pp. 7-32
Author(s):  
Sanjay Mangla
Keyword(s):  
Trade Liberalization ◽  
Steel Industry ◽  
Panel Data Analysis ◽  
Steel Production ◽  
Firm Level ◽  
Production Factors ◽  
Level Data ◽  
Reform Period ◽  
Protection Rate ◽  
The Impact

The iron-steel industry in India contributes about 3% of gross domestic product and provides employment for more than half a million people. However, although steel production in India has increased at a trend growth rate of 7.83% during the post-reform period between 1991-1992 and 2012-2013, this does not necessarily indicate efficient utilization of production factors, as it can also result from a higher level of inputs. Therefore, it is important to record productivity growth and identify its determinants. This study estimates total factor productivity (from firm-level data) in the Indian iron-steel industry and examines the impact of trade liberalization (measured as decline in input tariffs, output tariffs, and effective protection rate) on productivity during the abovementioned period.

Trade sanctions and green trade liberalization

2010 ◽  
Vol 15 (4) ◽  
pp. 379-394 ◽  
Author(s):  
ALIREZA NAGHAVI
Keyword(s):  
Trade Liberalization ◽  
World Trade ◽  
Trade Policies ◽  
Environmental Standards ◽  
Equilibrium Outcome ◽  
Trade Sanctions ◽  
Credible Threat ◽  
The Impact ◽  
Optimal Tariff ◽  
Pollution Havens

ABSTRACTThis paper studies the impact of a World Trade Organization withdrawal of trade concessions against countries that fail to respect globally recognized environmental standards. We show that a punishing tariff can be effective when environmental and trade policies are endogenous. When required standards are not too stringent with respect to the marginal damage of pollution, compliance along with free trade as a reward is the unique equilibrium outcome. A positive optimal tariff in the case of non-compliance prevents complete relocation to pollution havens, but only works as a successful credible threat and does not emerge in equilibrium.

scholarly journals Trade Liberalization and its Environmental Impact in India: An Empirical Analysis

2018 ◽  
Vol 7 (1) ◽  
pp. 111-119
Author(s):  
Ranjan Aneja ◽  
Ummed Singh
Keyword(s):  
Trade Liberalization ◽  
Significant Contribution ◽  
Manufacturing Industries ◽  
Economic Activities ◽  
Environmental Consequences ◽  
Pollution Haven ◽  
Level Data ◽  
Pollution Haven Effect ◽  
The Impact ◽  
Industry Level Data

The debate on the impact of trade on environment is pertinent considering the increasing volume of trade among world nations and the changes in environmental quality. In India, this increase was higher because of the gradual lifting of the quantitative restrictions and reduction in tariffs after trade liberalization in 1991. The pollution haven effect occurs when trade liberalization, coupled with lax environmental regulations results in increasing economic activities in pollution intensive industries. Using industry level data for the period 1998-2008, for fifty eight manufacturing industries in India, this paper looks at output and export trends and attempts to examine, whether trade liberalization is associated with a shift in production and exportation towards pollution intensive goods industries (pollution haven effect). Manufacturing output has been significantly higher from the water pollution intensive sectors compared to the air and toxic pollution intensive sectors. This evidence provides some support for concerns that there is significant contribution in production of manufacturing industries from dirty industries. The results of the study suggest that while trade liberalization measures have been pursued to promote economic growth in India but they have led to some potentially adverse environmental consequences.

scholarly journals Co-location of Formal and Informal Manufacturing and Firm’s Performance: Evidence from India

2021 ◽  
pp. 001946622110401
Author(s):  
Renjith Ramachandran ◽  
Subash Sasidharan
Keyword(s):  
Informal Sector ◽  
Positive Impact ◽  
National Sample ◽  
Sample Survey ◽  
Formal Sector ◽  
Manufacturing Plants ◽  
Annual Survey ◽  
Level Data ◽  
Plant Level ◽  
The Impact

This study analyses the impact of co-location between formal and informal manufacturing sectors on plant-level productivity. We employ a unique data obtained by merging plant-level data from Annual Survey of Industries (ASI 2011–2012) and Survey of Unorganised Manufacturing and Repairing Enterprises provided by National Sample Survey Office (NSSO 67th round). We find that formal and informal manufacturing plants gain from localisation. Further, co-location with informal enterprises has a positive impact on productivity of formal sector plants; however, we observe insignificant impact of co-location on informal sector enterprises. Additionally, we find evidence that informal sector enterprises benefit from industrially diversified regions. JEL Classifications: D24, R12, R3

scholarly journals The Impact of Special Economic Zones on Exporting Behavior

2019 ◽  
Vol 11 (1) ◽  
pp. 145-174
Author(s):  
Roland B. Davies ◽  
Arman Mazhikeyev
Keyword(s):  
Special Economic Zone ◽  
Extensive Margin ◽  
Export Intensity ◽  
Firm Level ◽  
Closed Economies ◽  
Level Data ◽  
Firm Level Data ◽  
Negative Effect ◽  
Economic Zones ◽  
The Impact

Using firm level data from Africa and Asia, we estimate the impact of being in a special economic zone (SEZ) on a firm's probability of exporting, export intensity, and value of exports. At the extensive margin, we find that SEZ firms in open economies are 25% more likely to export than their non-SEZ counterparts, with a large negative effect in closed economies. At the intensive margin, we find that SEZs increase the value of exports, but only in countries with barriers to imports where the estimate increase is 3.6%. Thus, the estimated effect of introducing an SEZ can be meaningful, but is heavily contingent on the local economic environment.

scholarly journals Proximity and Investment: Evidence from Plant-Level Data *

2013 ◽  
Vol 128 (2) ◽  
pp. 861-915 ◽  
Author(s):  
Xavier Giroud
Keyword(s):  
Travel Time ◽  
Total Factor Productivity ◽  
Extensive Margin ◽  
Sample Period ◽  
Factor Productivity ◽  
Firm Level ◽  
Level Data ◽  
Plant Level

Abstract Proximity to plants makes it easier for headquarters to monitor and acquire information about plants. In this article, I estimate the effects of headquarters’ proximity to plants on plant-level investment and productivity. Using the introduction of new airline routes as a source of exogenous variation in proximity, I find that new airline routes that reduce the travel time between headquarters and plants lead to an increase in plant-level investment of 8% to 9% and an increase in plants’ total factor productivity of 1.3% to 1.4%. The results are robust when I control for local and firm-level shocks that could potentially drive the introduction of new airline routes, when I consider only new airline routes that are the outcome of a merger between two airlines or the opening of a new hub, and when I consider only indirect flights where either the last leg of the flight (involving the plant’s home airport) or the first leg of the flight (involving headquarters’ home airport) remains unchanged. Moreover, the results are stronger in the earlier years of the sample period and for firms whose headquarters is more time-constrained. In addition, they also hold at the extensive margin, that is, when I consider plant openings and closures.

Agriculture, Trade Liberalization and Poverty in the ACP Countries

2019 ◽  
pp. 1408-1427
Author(s):  
Theresa Ann Rajack-Talley
Keyword(s):  
Food Security ◽  
Trade Liberalization ◽  
Food Production ◽  
Poverty Reduction ◽  
Farming Systems ◽  
Agricultural Trade ◽  
Trade Policies ◽  
Small Producers ◽  
The Impact

This chapter looks specifically at the impact of the ACP agriculture trade agreements on issues of food production, food security and poverty and how they relate in some ways to each other. It is divided into four distinct but inter-related sections. First, poverty in the ACP regions is briefly described. Secondly, the importance of agriculture, particularly the role of small farming systems to economic growth, employment, food production, food security and poverty reduction in the ACP countries is examined. Thirdly, the impact of the acceleration of trade liberalization and agriculture protectionism on ACP countries is reviewed and analyzed. Here, the trade arrangements and networks in the three ACP regions are described and include international, regional and local agricultural trade and market agreements. Further, the paradoxes and dilemmas that emerge are interrogated and their outcomes discussed. Particular attention is paid to small producers and women. The fourth and final section of the chapter concludes that while the impact of agriculture trade liberalization remains a mixed bag of positive and negative possibilities, one thing that is clear is that while trade liberalization is promoted as a cure for food security and world poverty, the jury is still out on whether it has helped or hindered this endeavour. Trade policies and arrangements do substantially change the lives of people in developing countries, but in very complex ways. Recommendations are made to support the South-South initiatives of the ACP and others as well as enhance regional and domestic agriculture production and trade policies. The author, however, warns that agriculture and trade policies must be linked closer to food security and the healthy diets of local populations.

Workers and Trade Liberalization: The Impact of Trade Reforms in Mexico on Wages and Employment

ILR Review ◽  
2001 ◽  
Vol 55 (1) ◽  
pp. 95-115 ◽  
Author(s):  
Zadia M. Feliciano
Keyword(s):  
Trade Liberalization ◽  
Wage Inequality ◽  
Trade Reform ◽  
Trade Reforms ◽  
Relative Wages ◽  
Relative Employment ◽  
Level Data ◽  
Mexican Government ◽  
Micro Level ◽  
The Impact

Between 1986 and 1990, the Mexican government reduced tariffs and import license coverage by more than 50%. The author, using micro-level data, analyzes the impact of trade reform on Mexican wages and employment. Industries that had greater reductions in protection levels, she finds, had a larger percentage of low-skill workers. Wage dispersion increased in both the non-tradables sector and, to a much greater degree, the tradables sector. This pattern suggests that trade reform increased wage inequality. The decline in import license coverage appears to have reduced relative wages of workers in reformed industries by 2%, but did not affect relative employment. Reductions in tariffs had no statistically significant effect on relative wages or relative employment.

scholarly journals The Declining Effects of Osha Inspections on Manufacturing Injuries, 1979–1998

ILR Review ◽  
2005 ◽  
Vol 58 (4) ◽  
pp. 571-587 ◽  
Author(s):  
Wayne B. Gray ◽  
John M. Mendeloff
Keyword(s):  
Injury Rates ◽  
Manufacturing Plants ◽  
Establishment Size ◽  
Level Data ◽  
Plant Level ◽  
The Impact

This study examines the impact of OSHA inspections on injuries in manufacturing plants. The authors use the same model and some of the same plant-level data employed by several earlier studies that found large effects of OSHA inspections on injuries for 1979–85. These new estimates indicate that an OSHA inspection imposing a penalty reduced lost-workday injuries by about 19% in 1979–85, but that this effect fell to 11% in 1987–91, and to a statistically insignificant 1% in 1992–98. The authors cannot fully explain this overall decline, which they find for nearly all subgroups they examine—by inspection type, establishment size, and industry, for example. Among other findings are that, across the years studied, inspections with penalties were more effective than those without, and the effects on injury rates were greater in smaller plants and nonunion plants than in large plants and union plants.

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